E. Martin Estrada, U.S. Attorney | U.S. Attorney's Office for the Central District of California
Milton C. Grimes, a veteran lawyer from Los Angeles, has been sentenced to 18 months in federal prison for evading the payment of over $7.2 million in taxes over more than two decades. The sentence was handed down by United States District Judge Stanley Blumenfeld Jr., who also mandated that Grimes pay $7,236,556 in restitution to both the IRS and the California Franchise Tax Board.
Grimes admitted guilt in October 2024 to one count of tax evasion concerning his 2014 taxes, acknowledging that he failed to pay $1,690,922 to the IRS. "Despite being a respected attorney, Mr. Grimes also made the deliberate decision to cheat on his taxes for decades," stated Acting United States Attorney Joseph T. McNally. He emphasized the detrimental impact of tax fraud on society and commended the IRS for their role in holding Grimes accountable.
Special Agent in Charge Tyler Hatcher from IRS Criminal Investigation's Los Angeles Field Office remarked on Grimes' awareness of his tax obligations as an attorney and law practice owner. Despite multiple IRS attempts to resolve his tax debts, Grimes continued to evade payments. Hatcher highlighted the proficiency of IRS investigators and noted that Grimes will now face consequences for his actions.
Grimes did not pay federal income taxes from 2002 through 2005, 2007, 2009 through 2011, and 2014 through 2023, with total liabilities amounting to $5,921,260 including penalties and interest owed to the IRS. He also acknowledged owing more than $1.3 million in state taxes from 2014 to 2023.
Beginning in September 2011, the IRS made over 30 attempts to levy Grimes’ bank accounts without success. From May 2014 to April 2020, he actively avoided paying outstanding taxes by not depositing client income into personal accounts subject to levies. Instead, he used approximately $16 million in cashier’s checks purchased with funds from various trust and business accounts.
The investigation was conducted by IRS Criminal Investigation and prosecuted by Assistant United States Attorneys Valerie L. Makarewicz and Sarah S. Lee from the Major Frauds Section.
